One of the most difficult aspects of export transactions is avoiding corruption and avoiding doing business with people who are prone to corruption. This page discusses a few of the laws, regulations and other sources that focus on anti-corruption efforts. This is by no means an exhaustive list and all parties should seek legal counsel and other guidance as to the various export and import laws and regulations that may affect any specific export transaction. In connection with EXIM Bank supported transactions, it is imperative to be acquainted with the laws, guidelines and debarment lists discussed below.
Foreign Corrupt Practices Act (FCPA)
U.S. firms and individuals seeking to do business in foreign markets must be familiar with the Foreign Corrupt Practices Act of 1977 (FCPA), 15 U.S.C. §§ 78dd-1, et seq., which, in general, prohibits corrupt payments to foreign officials for the purpose of obtaining or keeping business. The antibribery provisions of the FCPA make it unlawful for a U.S. person, and certain foreign issuers of securities, to make a corrupt payment to a foreign official for the purpose of obtaining or retaining business for or with, or directing business to, any person. They also apply to foreign firms and persons who take any act in furtherance of such a corrupt payment while in the United States.
Congress enacted the FCPA to bring a halt to the bribery of foreign officials and to restore public confidence in the integrity of the American business system. Several firms that paid bribes to foreign officials have been the subject of criminal and civil enforcement actions, resulting in large fines and suspension and debarment from federal procurement contracting, and their employees and officers have gone to prison. To avoid such consequences, many firms have implemented detailed compliance programs intended to prevent and to detect any improper payments by employees and by third-party agents. EXIM Bank reserves the right to require that exporters, lenders and, where appropriate, other participants, disclose, upon demand: (i) the identity of persons acting on their behalf in connection with the transaction, and (ii) the amount and purpose of commissions and fees paid, or agreed to be paid, to such persons. EXIM Bank also reserves the right to reject or cancel any transaction where there is a reasonable basis to believe that bribery has occurred.
OECD Anti-bribery Recommendations
Consistent with the FCPA, the Organization for Economic Cooperation and Development (OECD) has promulgated anti-bribery recommendations to combat bribery of foreign public officials in international business transactions, which the U.S. Government has agreed to follow in its export credit practices. EXIM Bank adheres to these recommendations, including the recommendation to conduct enhanced due diligence with regard to any exporter or applicant that has been indicted, convicted or debarred for bribery.
The Office of Foreign Assets Control
The Office of Foreign Assets Control (OFAC) is a bureau in the U.S. Department of the Treasury, and it oversees U.S. Government sanctions against countries and individuals. OFAC maintains a list known as the Specially Designated Nationals (SDN) list (Office of Foreign Assets Control). U.S. citizens, among others, are prohibited from doing any business with persons or entities listed on the SDN list or as to which OFAC regulations otherwise prohibit conducting business. Participants in EXIM Bank transactions should check the OFAC SDN list to make sure that no participants in the transaction – or the principals of participants – are listed in the SDN list.
EXIM Bank Transaction Due Diligence Best Practices
EXIM Bank has issued guidelines for Transaction Due Diligence Best Practices. These are intended to improve the transparency and effectiveness of EXIM Bank's due diligence policies. These "know-your-customer" guidelines help the Bank's partners more easily identify the key risk issues the Bank considers in evaluating applications.
The guidelines also benefit taxpayers by balancing the efficient and timely execution of the Bank's mission – supporting exports to create U.S. jobs – with ensuring that EXIM Bank supports creditworthy and legitimate transactions.
Excluded Parties List System (The Debarment List)
The U.S. Government maintains a debarment list known as the Excluded Parties List System – the EPLS - (Excluded Parties List System). People and companies listed on the Excluded Parties List System are debarred from doing business with the U.S. Government, except under very narrow limited circumstances. Participants in EXIM Bank transactions should check the EPLS to make sure that no participants in the transaction – or the principals of participants – are listed in the EPLS.
Other Debarment Lists
Many multilateral and other institutions also have debarment lists. Participants in EXIM Bank transactions should make a practice of checking other debarment lists as a step in conducting due diligence with regard to the various participants in a transaction. The EXIM Bank Exporter's Certificate and the various applications for EXIM Bank transactions require certifications that the entity signing (and, in some cases, the principals of such entity) are not on either the EPLS or any of the multilateral bank debarment lists set forth below, as well as the African Development Bank, (which does not maintain a published list).
|World Bank||Inter-American Development Bank|
|Asian Development Bank||European Bank for Reconstruction and Development|